American Airlines told its pilots union Tuesday it wants to go to arbitration, saying that contract talks have not progressed between the two parties.
American and the Allied Pilots Association have been in discussions this fall to come up with a joint collective bargaining agreement to cover pilots from both American and US Airways, but have been far apart on issues of pay and work rules.
“Although we have offered a proposal that is better than what will be achieved through arbitration, the APA Board of Directors is not yet comfortable accepting those terms or putting them out to its members for a vote,” American President Scott Kirby said in a letter sent to all pilots on Tuesday. “Both sides have worked hard to this point, but the last proposal we received from the APA was significantly more expensive than even their previous proposal and in negotiations that simply takes us backwards.”
With American’s announcement on Tuesday that it would give most workers 4 percent raises in 2015, Kirby said it was increasing its contract offer to include pay raises of 23 percent upon signing, up from about 18 percent.
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Kirby noted the pay rates would be 7 percent higher on average than pilot pay rates at Delta Air Lines. The contract also includes annual pay increases of 3 percent every year starting in January and running through 2019.
With the proffer of arbitration, negotiations between American and the pilots union will not continue, Kirby said. But if the union accepts the company’s latest contract offer before Jan. 3, the higher pay rates would be retroactive to Dec. 2.
The company expects the arbitration hearing to begin in late February. Under its merger agreement with the pilots, the arbitration contract has a set value that is currently lower than what American is offering.
The APA said its board of directors will meet on Jan. 2-3 to discuss American’s latest proposal to the pilots.
“The board will determine the union’s response to management’s revised proposal,” the union said in a hotline message on Tuesday.
Andrea Ahles, 817-390-7631